Correlation Between Dow Jones and Jiangsu Zhongtian
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By analyzing existing cross correlation between Dow Jones Industrial and Jiangsu Zhongtian Technology, you can compare the effects of market volatilities on Dow Jones and Jiangsu Zhongtian and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dow Jones with a short position of Jiangsu Zhongtian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Jiangsu Zhongtian.
Diversification Opportunities for Dow Jones and Jiangsu Zhongtian
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dow and Jiangsu is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Jiangsu Zhongtian Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Zhongtian and Dow Jones is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dow Jones Industrial are associated (or correlated) with Jiangsu Zhongtian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Zhongtian has no effect on the direction of Dow Jones i.e., Dow Jones and Jiangsu Zhongtian go up and down completely randomly.
Pair Corralation between Dow Jones and Jiangsu Zhongtian
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 0.7 times more return on investment than Jiangsu Zhongtian. However, Dow Jones Industrial is 1.42 times less risky than Jiangsu Zhongtian. It trades about -0.25 of its potential returns per unit of risk. Jiangsu Zhongtian Technology is currently generating about -0.65 per unit of risk. If you would invest 4,371,748 in Dow Jones Industrial on October 15, 2024 and sell it today you would lose (177,903) from holding Dow Jones Industrial or give up 4.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Jiangsu Zhongtian Technology
Performance |
| Timeline |
Dow Jones and Jiangsu Zhongtian Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Jiangsu Zhongtian Technology
Pair trading matchups for Jiangsu Zhongtian
Pair Trading with Dow Jones and Jiangsu Zhongtian
The main advantage of trading using opposite Dow Jones and Jiangsu Zhongtian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Jiangsu Zhongtian can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Jiangsu Zhongtian will offset losses from the drop in Jiangsu Zhongtian's long position.| Dow Jones vs. Chipotle Mexican Grill | Dow Jones vs. Teleflex Incorporated | Dow Jones vs. Dine Brands Global | Dow Jones vs. Alvotech |
| Jiangsu Zhongtian vs. Pengxin International Mining | Jiangsu Zhongtian vs. Jiugui Liquor Co | Jiangsu Zhongtian vs. Rising Nonferrous Metals | Jiangsu Zhongtian vs. Hubei Geoway Investment |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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